SEC filed 40 civil cases against Chinese companies.

Retired U.S. Army General and former presidential contender Wesley K. Clark was the chairman and public face of a Wall Street investment firm that rode a wave of interest in Chinese stock, and then plunged on reports that much of the profit was hype and many of the companies were outright frauds.

Now the China deals Clark helped promote at lavish parties are among those facing scrutiny from the Securities and Exchange Commission as they try and account for the billions of dollars lost in dozens of suspicious stock offerings, which some officials believe represent collectively one of the largest financial scams since Bernie Madoff. Authorities told ABC News that firms serving as middle men who helped promote the Chinese companies are now in the crosshairs.

"The auditors, the lawyers, the promoters, the brokers, those are all gatekeepers that we're very focused on," former SEC Chairman Mary Schapiro said in an interview in December, shortly before she stepped down. "We're investigating their conduct, absolutely."

Clark has declined repeated requests to be interviewed. But in a statement emailed to ABC News this week Clark said he is not aware of any investigation into the firm he headed until last summer, Rodman & Renshaw, or into his own actions while leading the firm.

"I am not aware of any investigation into the firm and always insisted my colleagues uphold the highest ethical standards," Clark said.

An ABC News investigation reported this month that more than 70 China-based companies have withdrawn or been tossed off of the New York Stock Exchange and NASDAQ since 2010. Officials say a spree of alleged frauds touched large numbers of American investors, both though losses by public pension funds and 401K's, by Wall Street titans and hedge funds, and by small investors who traded from their lap tops. It's money that authorities say is unlikely to be recovered.

"What's left is the postmortem," said Dan David, vice president of the firm GeoInvesting, and an expert on the China boom and bust. "The billions are gone."

The SEC has brought more than 40 civil cases against Chinese firms, and the former head of the financial watchdog agency told ABC News that investigators were also looking into the conduct of key players in the U.S. who promoted the Chinese firms to potential investors.

One of the firms that pushed most aggressively for investment in Chinese companies was Rodman & Renshaw, a boutique operation based in New York and chaired by Clark, the retired four-star general and war hero who mounted a bid for the Democratic presidential nomination in 2004. Clark became chairman of the investment firm in 2009, just as it was emerging as a central player in the China investment wave.

Clark said in his statement to ABC News that his firm was distressed by the revelations about many of the Chinese companies it had promoted.

"Our firm was a leader in bringing small and medium-size Chinese companies to the U.S. capital markets," he said. "No one is more disappointed than the bankers at the firm that some of these companies -- despite receiving consistently clean bills of health from well-respected lawyers and auditors -- apparently concealed improper business practices."

The general did not run day-to-day activities at the firm, instead chairing board meetings and lending his star power during extravagant annual conferences, where investors were invited to hear presentations from dozens of Chinese companies trying to attract financing as they joined American stock exchanges. The conferences were luxurious affairs held at the Waldorf in New York and Le Royal Meridien Hotel in Shanghai. Henry Kissinger spoke at one, former Sen. Chris Dodd, D.-Conn., at another. Diana Ross performed, as did En Vogue.

In 2010 the firm rented out the Forbidden City in Beijing, and invited former Secretary of State Colin Powell to speak. Crooner Lionel Ritchie provided the entertainment as thousands of potential investors dined in tents on the historic grounds.

"The Chinese love important people and General Clark was certainly able to draw them to the conferences," said Drew Bernstein, the managing member of Marcum Bernstein & Pinchuk, one of the largest accounting firms servicing China-based companies trading in the U.S. "Almost everybody that spoke was connected somewhere to government and military. Rodman did this because it leant an air of credibility to everything they were doing."

Roddy Boyd, a financial investigator who founded the Southern Investigative Reporting Foundation, attended several of the conferences. Boyd said there is no way to know how much Clark knew about the firm's efforts to scrutinize Chinese companies, or whether his only role with Rodman & Renshaw was as a figure head. There were certainly executives at the firm, Boyd said, who had far more direct involvement in vetting Chinese companies before they were pitched to investors. Boyd said he believes Clark's presence on the firm's board was intended to shape Rodman's public image.

"He was a smiling authoritative, commanding face, very reassuring to an American investor," Boyd said.

But many of the Chinese companies being promoted at the Rodman & Renshaw conferences turned out to be suspect. An analysis by ABC News found that 20 of the 40 Chinese companies that presented at the 2010 conference have since lost their listing on U.S. exchanges, and another 10 are trading at below $1 per share. One of the companies that presented at a 2008 Rodman conference at the New York Palace Hotel was Puda Coal. The rural Chinese company purported to own one of the country's largest coal mining operations.

The company traded on the New York Stock Exchange from 2009 to August 2011, when trading halted on word that Puda's chairman had secretly transferred control of the company's sole source of revenue to himself and turned Puda into an empty shell company before selling shares to the public. Shares of Puda stock dropped from a high of $17 to pennies and cost investors hundreds of millions of dollars, according to an SEC civil fraud complaint filed last year.

In the case of one small investor interviewed by ABC News, truck stop manager Al Smith of Boise Idaho, $60,000 of his retirement evaporated overnight.

"There's no recourse," Smith said. "It's very frustrating."

As more and more Chinese companies began to be exposed – mostly by so-called short sellers who had placed bets on the companies failing – Rodman & Renshaw's business model began to falter. The firm announced last year it was abandoning the China market and soon after it was subsumed by its parent company, Direct Markets Holdings Corp. Calls to Direct Markets were not returned. A lawyer representing Rodman & Renshaw in an investor lawsuit also declined to comment.

Bernstein said it would be tough to look at how so many Chinese companies falter and not question the way Rodman & Renshaw championed those companies to investors.

"With respect to the China market, it's tough to say anything but that they handled themselves poorly," he said. "If you got all the investment bankers in a room and you ask them why did all this happen, the one thing they would admit is that they could have done better or more due diligence on these companies."

Schapiro agreed, saying that investors "rely on the brokers to do their due diligence and to ensure that they're only recommending stocks to investors that are appropriate."

Most of those who worked at Rodman have moved on to other ventures. Last year, when the Pittsburgh Tribune Review published one of the first in-depth reports about the firm's track record on China investments, former Rodman CEO John J. Borer told the newspaper that "a lot of Chinese companies have suffered for a lot of reasons." He said the firm's customers were seasoned investors who were aware of the risks involved in investing in a company based in China.

Clark, however, has said little about the firm's track record. The general announced last summer he was stepping down as chairman and has declined repeated requests for an interview about his tenure at the firm.

Initially, when ABC News tracked him down after a public appearance at a conference in Orlando in December, he said he could not discuss anything related to Rodman & Renshaw because the firm was in the midst of being sued.

"Can't talk about it because it's in a court case," Clark said as he hurried away. "It cannot be talked about."